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Air India ends 30-year-old ties with ticket reservation company

In an important move, national carrier Air India (AI) ended its thirty-year-old relationship with global air ticket reservation data provider Amadeus on Tuesday. Travel agents say the immediate impact will be felt by passengers whose AI tickets were booked through agents/travel portals using Amadeus computerised reservation network, which is a Global Distribution System (GDS) company.

| TNN | Updated: Dec 5, 2018, 12:29 IST

Highlights

GDS is a computer network and reservation tool that holds real-time data on airline inventory, fares, availability and other such details

Globally, the most popular GDS companies are Amadeus, Travelport and Sabre

AI will save Rs 3,000 crore in six years on ticket sales and distribution costs, an official said

Image used for representative purpose

MUMBAI: In an important move, national carrier Air India (AI) ended its thirty-year-old relationship with global air ticket reservation data provider Amadeus on Tuesday. Travel agents say the immediate impact will be felt by passengers whose AI tickets were booked through agents/travel portals using Amadeus computerised reservation network, which is a Global Distribution System (GDS) company.

GDS is a computer network and reservation tool that holds real-time data on airline inventory, fares, availability and other such details, and passes it on to travel agents to allow them to make bookings.

If these passengers plan to cancel, change or rebook their tickets, they might face a problem since Amadeus no longer handles AI bookings. AI officials allayed these fears, stating the airline has done the groundwork and passengers won’t face any problems on account of the change.

At 5.30 am, AI took its air ticket inventory off Amadeus global computer network to deepen its relationship with the latter’s rival, the UK-based Travelport. With the move, AI believes it will save Rs 3,000 crore in the next six years. AI’s critics have warned that severing relationship with Amadeus, the current market leader, would impact its ticket bookings, as most of the travel agents in India are on the Amadeus system.

Globally, the most popular GDS companies are Amadeus, Travelport and Sabre.

Passengers won’t know which GDS provider has handled their booking unless the agent informs them. A travel industry insider said, “Airlines allow 362 days of advance purchase and there would be about a million AI passengers the world over booked on the Amadeus system. If they intend to cancel or reschedule the booking, they might face problems with refunds, etc.”

But a highly-placed AI official said, “Only 15% tickets are cancelled or rescheduled. We have transferred PNRs wherever applicable. It’s a historic decision that will change the GDS scene the world over. AI will save Rs 3,000 crore in six years on ticket sales and distribution costs.”

AI inventory was available on all the three GDS. On June 4, AI’s agreement with Amadeus expired and the airline pulled out its inventory after a six-month notice period. In the past one week, petitions in public interest were filed in three different high courts against AI’s decision to make Travelport its exclusive GDS provider.

Critics of the AI move point out that Amadeus is the leading GDS provider in India, Europe and the Middle East—markets where AI earns most of its revenue from. “In India, about 55% travel agents use Amadeus, which alone generated Rs 10,000 crore worth of business for AI in the last financial year. AI will lose about 30-40% of that revenue. Amadeus has alternative flights by other airlines on 87% city-pairs flown by AI and these agents will sell them,” said an insider.

An AI spokesperson countered that there was no risk of loss of business. “We have issued guidelines to all agents to handle change requests, etc. on bookings. All our offices and call centers are fully geared up to handle any such queries. Agents still have the ability to cancel and refund these bookings,” the spokesperson said.

AI tickets will continue to be available with major companies like Cox and Kings, Thomas Cook and online travel portals like
yatra.com that use all the three GDS systems and also on those portals which use Travelport like Makemytrip, Goibibo and Cleartrip. The local, small-time travel agent, who offered you discounts on AI flights, might be hit though.

Praveen Chugh, president, Travel Agents Federation of India, said: “Majority of travel agents in India use the Amadeus system. They've trained on it for decades, it’s user-friendly. If these agents have to sell AI tickets now, they have to train on the Travelport reservation system. It isn’t an easy switch for the agents. Apart from training delays, the agents have long-term agreements with Amadeus, which they cannot violate without legal ramifications. Majority of the international tickets are booked by travel agents, but since most are on Amadeus, they will now sell bookings on airlines like Lufthansa, British Airways and Jet Airways. AI might lose out on bookings.”

AI officials say Travelport has made inroads into India. IndiGo, the largest airline in India, for instance, has been exclusively handled by Travelport since 2016. Along with Air India Express, AI has 43% share of international traffic to and from India among Indian carriers and a 17% share, including global airlines, as of Q3 CY17, according to Travelport data.

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